On 03/28/2018 PORTFOLIO COFFEEHOUSE LLC filed a Contract - Other Contract lawsuit against JMS DEVELOPMENT LLC. This case was filed in Los Angeles County Superior Courts, Governor George Deukmejian Courthouse located in Los Angeles, California. The Judge overseeing this case is MARK C. KIM. The case status is Pending - Other Pending.
Pending - Other Pending
Los Angeles County Superior Courts
Governor George Deukmejian Courthouse
Los Angeles, California
MARK C. KIM
PORTFOLIO COFFEEHOUSE LLC- CA LLC
JMS DEVELOPMENT LLC- CA LLC
LAW OFFICE OF HENRY B. LATORRACA
TREDWAY LUMSDAINE & DOYLE ROY JIMENEZ
JIMENEZ ROY JOSEPH
LATORRACA HENRY BRIAN
1/29/2020: Trial Brief
1/16/2020: Proof of Personal Service
11/5/2019: Minute Order - MINUTE ORDER (HEARING ON MOTION FOR SUMMARY JUDGMENT)
10/30/2019: Objection - OBJECTION TO KERSTIN KANSTEINER DECLARATION
10/22/2019: Opposition - OPPOSITION TO DEFENDANT JMS DEVELOPMENT, LLC'S MOTION FOR SUMMARY JUDGMENT, OR IN THE ALTERNATIVE, SUMMARY ADJUDICATION OF ISSUES
10/17/2019: Minute Order - MINUTE ORDER (CASE MANAGEMENT CONFERENCE)
9/25/2019: Case Management Statement
6/12/2019: Minute Order - MINUTE ORDER (CASE MANAGEMENT CONFERENCE)
3/8/2019: Opposition - Opposition to Motion to Compel Further Responses to Request for Documents (Set 1)
3/11/2019: Notice of Ruling
3/5/2019: Minute Order - Minute Order (Hearing on Demurrer - without Motion to Strike)
2/20/2019: Opposition - Opposition Portfolio Coffeehouse, LLC's Opposition to JMS Development, LLC's Demurrer to Second Amended Complaint
5/11/2018: Legacy Document - LEGACY DOCUMENT TYPE: Notice
10/24/2018: Other - - Other - Plaintiff's Protfolio Coffeehouse, LLC's Compendium of Federal Authorities
11/27/2018: Notice - Notice of errata re second amended complant
10/25/2018: Case Management Statement
10/29/2018: Reply - Reply of Defendant Re Its Demurrer to First Amended Complaint
8/16/2018: Reply -
Hearing09/28/2020 at 08:30 AM in Department S27 at 275 Magnolia, Long Beach, CA 90802; Jury TrialRead MoreRead Less
Hearing09/24/2020 at 08:30 AM in Department S27 at 275 Magnolia, Long Beach, CA 90802; Final Status ConferenceRead MoreRead Less
Hearing08/04/2020 at 08:30 AM in Department S27 at 275 Magnolia, Long Beach, CA 90802; Hearing on Motion for Summary JudgmentRead MoreRead Less
DocketNotice (of Continued Motion for Summary Judgment); Filed by PORTFOLIO COFFEEHOUSE LLC- CA LLC (Plaintiff)Read MoreRead Less
Docketat 09:34 AM in Department S27, Mark C. Kim, Presiding; Court OrderRead MoreRead Less
DocketMinute Order ( (Court Order)); Filed by ClerkRead MoreRead Less
DocketCertificate of Mailing for ((Court Order) of 04/27/2020); Filed by ClerkRead MoreRead Less
DocketSeparate Statement; Filed by Michael Salemi (Defendant)Read MoreRead Less
DocketExhibit List; Filed by Michael Salemi (Defendant)Read MoreRead Less
DocketRequest for Judicial Notice; Filed by Michael Salemi (Defendant)Read MoreRead Less
DocketStipulation; Filed by Law office of Henry B. LaTorraca (Legacy Party)Read MoreRead Less
DocketDeft's Ntc of Hrng on Demurrer; Filed by JMS DEVELOPMENT LLC- CA LLC (Defendant); Law office of Henry B. LaTorraca (Legacy Party)Read MoreRead Less
DocketDemurrer; Filed by JMS DEVELOPMENT LLC- CA LLC (Defendant); Law office of Henry B. LaTorraca (Legacy Party)Read MoreRead Less
DocketRtn of Service of Summons & Compl; Filed by PORTFOLIO COFFEEHOUSE LLC- CA LLC (Plaintiff)Read MoreRead Less
DocketNotice of Case Assignment - Unlimited Civil CaseRead MoreRead Less
DocketOrder (To Show Cause Hearing)Read MoreRead Less
DocketNotice of Case Management ConferenceRead MoreRead Less
DocketCivil Case Cover SheetRead MoreRead Less
DocketComplaint; Filed by PORTFOLIO COFFEEHOUSE LLC- CA LLC (Plaintiff)Read MoreRead Less
DocketSummons; Filed by PlaintiffRead MoreRead Less
Case Number: NC061708 Hearing Date: November 05, 2019 Dept: S27
JMS Development, LLC moves for summary judgment on the 2nd Amended Complaint of Plaintiff Portfolio Coffeehouse, LLC. Alternatively, Defendant moves for Summary Adjudication of each of the causes of action:
1. Breach of Contract
2. Declaratory Relief
The parties executed a commercial lease on April 30, 2013 for the property at 2300 E. 4th St. in Long Beach. Defendant is the owner and Plaintiff the lessee. The lease term ran from March 26, 2013 through July 31, 2017.
Section 2 of the lease contained an option to extend the lease for an additional five-year term. That section states “see attached addendum” but there is no addendum attached. The complaint denies any separate option agreement was presented to it, and alleges the reference is a mistake by whoever drafted the instrument. On that basis, Plaintiff alleges that the option referenced in Section 2 is “the entire written agreement” concerning the five-year extension. Plaintiff alleges it expended “time and money developing the property” in reliance on an option for a five-year extension.
The initial base rent was $5,100/month with an annual rent increase based on the Consumer Price Index, not to exceed 3%.
Plaintiff alleges that in Paragraph 39 of the lease Defendant “agreed to provide Plaintiff with additional rent space based on Plaintiff’s prior history of renting this space from Defendant. Plaintiff had been renting this space for many years prior to the current lease.” (Paragraph 9)
Plaintiff alleges it exercised the option on July 31, 2017 by “delivering written notice through their personal courier to Defendant’s office” (2310 E. 4th St. Rear Building Long Beach CA 90814”) as provided by Section 36(i).
Defendant is alleged to have denied both the exercise of the option and an alleged increase in floor space set forth in Paragraph 39 of the lease (“Lease includes all space currently occupied by tenant including most recent additional space made available on October 2012.”)
On March 8, 2018 Plaintiff was served with a 3-day notice to pay rent or quit “demanding $6,211.46 in base rent for the month of March and $500 in late fees.”
Plaintiff alleges it delivered a check in the sum of $6,211.46 that same day with a cover letter stating the payment was under protest.
On March 10 Defendant returned the check along with an invoice for April rent in the sum of $6,211.46.
Defendant requests judicial notice of the “true signification” of “service” and “courier” as used in Paragraph 36 of the lease. The court will take notice of dictionary definitions but declines to take notice that these definitions are dispositive or “true” with respect to the intent of the parties.
The court grants judicial notice of the 2nd Amended Complaint and Plaintiff’s Notice of Errata including Exhibit 1.
The court first rules on Plaintiff’s objections to the moving evidence:
Declaration of Edward Salemi (managing member of Defendant)
4. Sustained in part – lack of personal knowledge. Mr. Salemi’s “understanding” that “no one at JMS” received Exhibit 1 to the Kansteiner deposition (the notice of exercising the option) prior to August 1, 2017 is without foundation, too. The court accepts his testimony that he, personally, did not receive Exhibit 1 prior to that date – to that extent the objection is overruled.
Declaration of Nikki Truong
2. Sustained in part - lack of personal knowledge. Declarant’s “understanding” that “no one at JMS” received Exhibit 1 prior to August 1, 2017 is without foundation, too. The court accepts the testimony that declarant, personally, did not receive Exhibit 1 prior to that date – to that extent the objection is overruled.
This motion seeks to negate Plaintiff’s claim that the option was timely and properly exercised consistent with the terms of the lease. If Defendant is correct, then there is no breach of contract and Plaintiff would not be entitled to a declaration in its favor.
Although the 2nd Amended Complaint does not specify what declaration is sought, in context Plaintiff seeks a declaration the lease was extended and the terms of the extension “including but not limited to rents due thereunder.” If Defendant prevails on the issue of whether the option was exercised, Plaintiff would not be entitled to a declaration of extension terms and rent due.
The court notes that the 2nd Amended had a clerical error in that the lease was not appended as an exhibit despite an allegation to the contrary. Plaintiff cured this problem by filing a notice of errata with missing Exhibit 1. The court accepts this exhibit as included on the face of the complaint.
Defendant submits the deposition of Kerstin Kansteiner who was produced as a Person Most Knowledgeable for Portfolio. Kansteiner testified that she delivered the notice of exercising the option. At pages 10 - 11 she states “I hand-delivered the extension through the mailbox of JMS Development” on July 31 2017 between 6:15 and 6:30 p.m. In response to defense counsel’s recapitulation of her testimony she confirms and clarifies her delivery was to a mailbox on the exterior of JMS’ building.
At page 14 she testifies the door to the JMS office was locked when she made the delivery. At page 15 she acknowledges she is not a “courier by occupation.”
JMS is correct that contracting parties must comply with the method of notice of extension as agreed to in the lease but “strict compliance” is an overstatement. The citation to Cal.Jur.3d (which is a treatise and not binding authority) only states there must be an unequivocal and unqualified expression of intention to exercise the option, and that it must be in the manner and terms agreed upon. But where language is subject to differing interpretations, it can be a question of fact on the parties’ intentions. The language of JMS’ exhibit 1 is an unqualified and unequivocal expression of intent to exercise the option. The question remains whether Plaintiff performed under the terms of the lease and whether any deviation was legally significant.
JMS refers to the court’s ruling sustaining a demurrer to the original complaint that Plaintiff was required to plead compliance with the contractual provision or excuse. The original complaint only alleged delivery to a mailbox on the last day of the window to exercise the option. In the amended complaint Plaintiff alleged delivery of written notice through a personal courier to Defendant’s office. We are past the pleading stage, however.
JMS quotes CC §§1636 – 1656 which are rules for contract construction. The court is aware of these statutes and follows them, but JMS does not directly explain which are directly pertinent to its position but the court will keep them all in mind in reaching its ruling. Among the points are:
1. Particular clauses are subordinate to its general intent. (§1650). This is true, but JMS does not identify the general intent and which clauses are subordinate.
2. Ambiguities are construed against the party who caused the uncertainty to exist. (§1654) There is no evidence as to which party caused the ambiguity to exist – presumably the lease was prepared by Defendant.
3. Technical words are to be interpreted as usually understood by persons in the business or profession to which they relate. (§1645). “Courier” is not a technical word and neither party is in the courier business. “Service” is a legal term of art and neither party is in the legal profession.
4. The court agrees that CC §1638 requires the language of the contract governs interpretation if the language is clear and explicit and does not involve absurdity. §1636 requires a contract be interpreted to effectuate the intent of the parties.
JMS’s first argument is that reference to an addendum which was not attached renders the option too indefinite to enforce. Defendant has not met its burden of persuasion on this point. As Plaintiff points out, the duration of the extension is expressly for five years. Absent an addendum, the extension incorporates the terms of the lease, including the terms for annual rent escalation. The parties do not dispute that Paragraph 36 controls the method for all legal notices, which would include the exercise of the option. This ambiguity is alleged to be clerical error and JMS does not present evidence to contradict that allegation.
The court did not “already rule that the absence of the referenced addendum renders the option too indefinite to be enforced.
The lease required notices to be served by mail, facsimile or courier to 2310 E. 4th St. Rear Building, Long Beach, CA 90814. The court disagrees that to be a “courier” requires a professional standing. Courier can be synonymous with “messenger.” The Compact Edition of the Oxford English Dictionary (Oxford Univ. Press 1971) defines “courier” as “a messenger sent in haste.” The position that a third party must be hired is a strained interpretation. A courier delivers messages or packages. Kansteiner could be found to be acting as a courier by the fact-finder if her testimony is credited.
JMS also argues that delivery to a mailbox is not an authorized method under the lease. To the contrary, the lease expressly authorizes delivery by mail, which would mean delivery to a mailbox. The court sees no practical distinction between mailing notice and personally dropping the notice into the mailbox. The delivery was to be to an address, not to any specific individual.
The court finds that the declaration of Kerstin Kansteiner creates a triable issue of whether there was a timely exercise of the option. Although the Defendants’ witnesses deny receipt of the notice, Kerstin Kansteiner testifies she delivered the notice after 5:00 p.m. when Edward Salemi and Nikki Truong state they left the office. The court does not see any provision in the lease stating the delivery had to be before the close of business hours. Whether there was timely delivery is a credibility call for the jury which cannot be resolved as a matter of law on the record provided.
JMS has not met its burden of persuasion that Plaintiff cannot be entitled to a declaration in its favor as a matter of law.
The motion is denied.